The Need for Consumer Participation in the Reforms Process of the

Susanne Rabisch,
CUTS Nairobi
+ Introduction
A snapshot of the Kenyan Electricity Sub-sector
15% of the Kenyan population are connected to electricity
and a mere 1% of the rural population had access to
electricity (Karekezi&Kimani 2004)
The Rural Electrification Programme: increase in
connections from 251,056 customers in June 2010 to 309,287
as in June 2011 23.2% growth rate (KNBS 2012)
Installed capacity expanded by 8.6 per cent to 1,534.3 MW in
2011, while the total electricity generation rose by 8.4 per
cent to 7,559.9 GWh in 2011
Total electricity consumption showed growth rate of 9%
from 5,754.7 GWh in 2010 to 6,273.6 GWh in 2011 (KNBS
Objectives of Kenyan Energy Policy
Ministry of Energy (2012)
“The overall objective of the energy policy is to ensure
affordable, sustainable and reliable supply to meet national
and county development needs, while protecting and
conserving the environment”.
Policy objectives that aim at consumer protection and
participation in the energy sector:
“ the protection of consumer interests”
“ the promotion of diversification of energy supply sources to
ensure supply security”
“ the promotion of healthy competition in the sector ”
“ the improved access to quality, reliable and affordable energy
services ”
Brief Overview of Electricity subsector Reforms in Kenya
Partial unbundling: electricity generation from electricity
distribution and transmission (Kenya Power)
Entry of private entities in electricity generation
(Independent Power Producers IPPs) in addition to
Government-owned institution established to develop new
electricity transmission infrastructure (KETRACO)
Establishment of the Energy Regulatory Commission in
2007 (on basis of The Energy Act 2006)
Establishment of the Rural Electrification Authority with a
mandate to extend electrification to remote areas
The Impact of Electricity Regulation
Investment Climate/Competitiveness - Economy
Cost/Reliability of Production - Private Sector
Cost of Living - Household Consumers
The need and avenues
for consumer
participation in
regulatory decision
making in the electricity
+ The Need for Consumer Participation in
Regulatory Reforms of the Electricity Sector
Legal and policy mandate to facilitate consumer
participation in regulatory reforms and consumer protection
Role of regulators: primary mandate to ensure consumer
welfare (large scale industrial and small scale HH and
MSMEs consumers)
Consumers’ interest should be heard because consumer are
ultimately impacted by regulation (eg. electricity tariffs):
Household consumer’s cost of living/quality of life
Private sector cost of production- multiplier effect
Investment climate for foreign investment – wider economic
+ The Need for Consumer Participation in
Regulatory Reforms of the Electricity Sector
The voices least represented are individual grassroots
consumers, private sector and other government agencies
are better placed to influence the regulatory process
Civil society to act as a watchdog that ensures the voice of
household consumers to be heard: CSOs to facilitate two way
communication between regulators and average consumers
Communicate consumer concerns and recommendations to
Communicate reform process (redress and complaints
mechanisms, tariff setting procedures etc.) to consumers
+ Avenues for Consumer Participation in
Regulatory Reforms in the Electricity sector
Written comments to regulators and policy makers
Consumer Representatives/CSOs to engage in
dialog with regulators
Public hearings (with average consumers)
Through Consumer Advocates (partnership
between regulators and consumer representatives)
+ Role of Consumers in Regulatory decisionmaking in the electricity sector in Kenya
Enabling legislation consumer
participation in regulation
and consumer protection in
Electric Power Act 1997
The Energy Act, 2006 (ERC)
Competition Act, 2010 (CAK)
Consumer Protection Act,
No clear
understanding/awareness of
enabling legislation
Lack of consumer awareness on
avenues for consumer
participation in electricity
Missing link between consumer
groups and civil society
organizations to engage with
regulators and policy makers
Need for clearly defined
engagement strategy
The Consumer Protection Act, 2012
Partnership Model of
consumer participation in
regulatory decision making
Legal basis for a consumer
representatives on the board
of all regulatory bodies in Kenya
Including the Energy Regulatory
Commission and the
Competition Authority of Kenya
Effective, timely
operationalization should
greatly increase consumer voice
As found in the CUTS Study:
“State of the Kenyan Consumer” 2012
Consumer Concerns in Electricity
in Kenya
(Asher & Sengupta 2012)
Consumer experience when
seeking redress in Kenya
(Asher & Sengupta 2012)
Consumer groups and CSOs require
capacity building in order to be able to
engage in the regulatory reform
process of the electricity sector
CSOs would benefit from networking
opportunities in which they can engage
with policy makers and regulators to
voice their concerns
Consumer-oriented regulation and
policy making in the electricity sector
has a profound effect on the livelihoods
of household consumers, MSMEs and
the Kenyan economy
There is a clear legal mandate for
consumer protection and participation
in regulatory decision making, which
needs to be operationalized effectively

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